"“This was the toughest session that I have ever seen. From the start, there was a lot of emotion . . . state Sen. Richie Sanders"

Thursday, April 22, 2004

Simpson County’s lawmakers believe a compromise on the two-year state budget will be reached before the fiscal year begins July 1.
Speaking at the annual Franklin-Simpson Chamber of Commerce Legislative Breakfast Saturday morning, state Rep. Rob Wilkey (D-Scottsville) and state Sen. Richie Sanders (R-Franklin) agreed that their parties and respective chambers of General Assembly will strike a deal.
“This was the toughest session that I have ever seen. From the start, there was a lot of emotion . . . But, I think after we get home and maybe cool off, we will be able to come back together and get something worked out,” said Sanders, the chairman of the Senate Appropriations and Revenue Committee and member of the budget conference committee.
Added Wilkey, “There was a lot of finger pointing and assignment of blame. I think it was the fault of the leadership in both houses and the governor.”
The General Assembly adjourned its 60-day regular session last week without a budget, which will total around $15 billion for the fiscal years of 2004-05 and 2005-06. The main stickling point is Gov. Fletcher’s tax modernization plan, which was attached to the Senate’s version of the budget.
The tax modernization plan would raise the cigarette tax from 3 to 29 cents per pack, would increase taxes on alcoholic beverages, close some business loopholes and replace existing local and state telecommunication taxes with a flat 7.62 percent rate. Revenue from those tax increases would be offset by cutting the top individual income tax rate from 6 to 5.7 percent and eliminating the corporation license tax. The low-income tax credit would be altered so that an additional 125,000 Kentuckians making $12,500 or less would haven’t to pay state taxes.
“There are two big court cases that played a big part is this tax modernization plan. . . There is also a lot of leakage (of tax dollars) out there. We’ve had to reduce our estimated revenue in the state budget for four years in a row. . . We need to modernize out tax code,” said Sanders.
Sanders pointed to one court decision that said the state could not give preferential tax treatment to corporations with headquarters located in Kentucky, while the other ruling said the state could not treat similar entities different, such as taxing cable television and not satellite service.
Wilkey said the House opposed the Senate’s move to attach the tax modernization plan to its budget for two reasons. One, he said, is that the tax changes would expire with the budget at the end of the 2005-06 fiscal year and the state needs something more lasting, and, two, Wilkey noted that the governor’s tax modernization plan did not do enough to generate more revenue for education.
“It (education) is the most important thing government does. This state has to have a well-educated workforce,” Wilkey said.
Wilkey noted that the House and Senate are closer now than they have been on agreeing on a spending plan. Gov. Fletcher was first reluctant to call a special session to approve a budget but now is considering one, the lawmakers said.
Several big projects in Simpson County are tied up in the stalled budget, including $12 million for a technical center, $3.8 million for improvements to Franklin Elementary and $800,000 in various water and sewer projects. Wilkey, the chairman of the House Transportation Budget Subcommittee, said bonding for the expansion of I-65 through Simpson County is also on hold.
Wilkey said he was able to move the proposal to widen I-65 to six lanes ahead in the state’s six-year road plan by two years. Even though the state can not borrow money on its share of the federal gas tax revenue until a budget is passed, Wilkey said the design phase will begin soon. The project’s targeted completion date was moved up to 2008.
The widening project would add a lane to the north- and south-bound lanes of I-65 from the Cemetery Road interchange in Bowling Green through Simpson County to the Tennessee state line. As part of the project, the bridge at Exit 6 in Simpson County would be expanded so U.S. 31-W south could be widened in the future, Wilkey said.
The lawmakers discussed several bills that passed during the 2004 session of the General Assembly, including one that increases court costs to help fund law enforcement agencies and county jails. However, County Judge/Executive Jim Henderson said Simpson County would realize only about $16,000 more a year for jail operations.
Wilkey said he received hundreds of calls from constituents on the proposed constitutional amendment to ban same sex marriage. The question will be put before the voters in November.
It was also announced that Gov. Fletcher agreed to restore funding for 1,000 Governor Scholars. His budget had proposed funding only 850, but both the Senate and House spending plans include funding for the full 1,000 spots.
Other bills passed deregulated the broadband internet industry in hopes of bringing the service to more rural areas and earmarking a portion of DUI fees to a brain injury support group.
The session was dominated by deliberations over the budget and tax modernization code and may be most remembered for what was not accomplished more than what was.
“Every single issue was politicized this year,” said Wilkey. “Quoting Winston Churchill, ‘Never have so many done so little with so much.’”